Eldon-Online

...And More Wait!

2009-11-12T17:09:28+08:00

While I take a positive decision about my weight, I really wish the Government in Hong Kong could do something positive about another type of wait!

Ever wondered why traffic in Central, particularly in the early evenings, is so diabolical? No, it's not the weight of rush hour traffic, although that clearly does not help. It is the inability of that traffic to move freely. And why is that?

I refer to the habit that some people have got into of being so lazy that they cannot suffer a little wait, or at least be considerate to other road users. They make their drivers park, sit, wait, double park - even triple park, for their convenience. If you are waiting for your car, which then arrives, you are often into the third lane of traffic to try and get in to it. It will only be a matter of time before someone gets hurt - physically.

It is selfish people who make their drivers come down town to pick them from areas such as the front of Princes Building , and then expect them to stay - preferably parked until they come out of the building. If they are delayed by 20 or 30 minutes, it doesn't seem to matter to them, and if they are with a friend they seem to enjoy the final discussion/chat just to indicate how important they think they are. Meanwhile cars are backing up round corners, and jammed on Chater Road because the traffic cannot get past the offending vehicles, slowing everything down. Cars with number plates like NP 36**; NZ 15**, CG *8, all of which have been recent culprits. (Okay, so I have partially protected them, but I have the photos - and I am sure they won't read this anyway, but steam released!)

Every so often the police come by, and then the drivers take off in a hurry, knowing that they should not be waiting so long, or be double parked, but the uniformed services undoubtedly have better things to do than act as traffic wardens and as soon as they leave the scene - back come the cars.

I feel sorry for the drivers actually. I am sure that if they are not there when the "boss" comes out of the building, expecting to step directly into his or her car, they will be told off.

Many other "world" cities seem to manage to cope with the problem through higher standards of driving discipline, ( I am sure someone will pick me up with a "world" city example that is worse - but I am talking about the city I live in), and through the employment of traffic wardens - and indeed, there seem to be some wardens in Hong Kong, occasionally, but never where they should be. Probably concerned about the stream of abuse they would suffer if they tried to book certain people. During the course of the day in Central, there are a number of favourite (but illegal) stopping places where drivers remain for as long as they dare until a policeman comes by and moves them on. Surely the amount of fines you could impose on illegal or disruptive parking would in most cases pay for the wardens, and would have the added benefit of making Hong Kong's roads a little easier to navigate.

I guess it is as much a plea for a little common courtesy to others. And yes, to whoever is thinking it, if I don't like it I can always go live elsewhere - but it's probably the pollution that will drive me to that decision before selfish individuals! I have enough friends who do behave decently to make that choice easier.

Weight For It.

2009-11-09T23:33:31+08:00

The reminders of ones own mortality seem, unsurprisingly, to be more frequent as one grows older but for some reason, at least in my case, they always appear to happen around this particular time of year. Five friends or acquaintances in the last three weeks alone and scarily, to me anyway, not one of them over 60. Were there underlying reasons? Perhaps in the case of two, yes, but the others were quite unexpected.

This alone sets one thinking, and having adopted a rather more sedentary lifestyle in recent years as sporting activities gave me up one by one, I discovered the distinct possibility that Michelin Man might have been modeled on a mirror image I was beginning to notice was following me around. Trying to ignore the fact that shirt collars were apparently shrinking in the wash, together with waist bands that suffered a similar fate at the dry cleaners, I battled bravely onwards. The need to meet deadlines and keep my work up to date was a convenient excuse. I was sampling any and all air line food because "it was something to do" on a long flight (actually, on short ones too). I was consciously sitting down to finish set meals at corporate events as it would have been rude to my hosts to leave anything on the plate (an old Westerner's habit - more as in "old Westerner", rather than an old habit - okay, it was how I was brought up! It was rude to leave anything, because it meant you didn't enjoy it and anyway, there were lots of people who would have been glad to have anything you left. )

Meanwhile my family were setting an example that I sort of missed. A new interest in training for triathlons from one, a continuing interest in extreme long distance planetary runs from another, a daily walk at speed from a third - and by proxy, of course, I was benefitting from all of this activity.

But then, another birthday slips into view and disappears, and younger friends who should still be around are suddenly no longer with us. The lifestyle begins to suggest (rather like the occasional doctor one sees), that even a modicum of additional exercise would not go amiss and, all of a sudden, the penny drops again.

Some years ago, about 2BR (two years Before Retirement) I think, I was wagered a decent sum of money that was to be handed over to charities of my wife's choice, were I to lose a fairly substantial amount of weight. I took on the challenge and won it, didn't know when to stop, and carried on removing further kilos. (I really understand how anorexia can get to people but, believe me, I was nowhere near that point!). However, in going down that path I began to look really old - no, seriously - to the point that I was asked at one time if I would say something publicly to reassure customers that I was actually well and healthy; they thought otherwise, it seems.

So now, senses restored, I am back in the groove. Thus if you see an elderly looking gweilo (I can call myself gweilo if I want to!) staggering slowly up Old Peak Road - all the way to the top occasionally - please don't break his concentration, or reduce his oxygen levels by speaking to him, but do give him a friendly wave, and pick him up if he has fallen over. If I start to look a little gaunt - the weight always comes off my face first which is a real nuisance - don't be alarmed. I actually look forward to the point when I can get back into my trousers without that sharp intake of breath prior to fastening them at the top, without bits of my neck hanging over my shirt collar, and being able to put on a different watch occasionally.

And if I reach my goals, there will be a couple of charities that should surely benefit from my own pleasure at having realised in time (hopefully), that while some things change you can positively help yourself.

When I'm Sixty Four....

2009-11-05T21:37:08+08:00

Remember the old Beatles song?

… will you still need me, will you still feed me

When I’m sixty four?

Well ageing is at last getting to be a recognised phenomenon right up there with climate change, although if no changes are made in that latter department, none of us will be still alive at 64 in a few generations!

One could say, slightly stupidly I suppose, that ageing is a “fact of life”. (Well, it is!). But whilst it is a fact that has been around for a while now, and there have been many papers and books written on the subject, it has only recently become a primary topic of regular discussion in the media particularly in relation to China. It was some years ago I first heard the phrase that China was going to get old before it got rich ... but then things went ominously quiet.

I first took a serious interest in the subject of ageing a little while before I became one of the relevant statistics. HSBC did some work with an engaging professor of gerontology on the subject of demographics, Dr. Ken Dychtwald, who has been one of the pioneers in studying the subject at length – putting a commercial interpretation on what it all meant for an organisation like the Bank and the territories in which it operated.

China then, as it does now, loomed large on the horizon back then but commentaries were more often aimed at the declining fertility in and the greying populations of, Europe and, in Asia particularly, of Japan. Fast forward to today, and recent reports on ageing in China.

A society is officially ageing, according to the UN (and to the SCMP, where I lifted the definition from), when 10% of its population is 60 or over and 7% is 65 or older. In China, from the latest available figures, those numbers are 13.59% and 9.29% respectively – whereas Hong Kong’s comparative statistic for the over 60s is 17.14%. No wonder Donald Tsang was so pleased with the statistic he trotted out to justify the government claim that Hong Kong air quality was not so bad, proving that Hong Kong people were living longer – and probably living indoors!

In China this longevity issue creates a real strain when one considers the effects of the one child policy, which is now really beginning to show through. Situations where one male child marries and has a child of his own, so he has a family of three to feed. But his elderly parents, and his wife's elderly parents are living longer and need supporting, so one person is supporting seven. No social security safety net, no government healthcare net, and unemployment in China is rising.

But there are problems elsewhere too. Most of the time the older ones amongst us rejoice (as long as we are in reasonable health) that we have an opportunity to live longer, but the strain it is going to put on society as we move forward is going to be almost as immense as the problem in China. Older people will be capable of, and in many cases want to, work for longer, meaning a clogging up of senior job promotion opportunities for the younger generation. If, for whatever reason, people do stop working at around 60 or 65 - and they are going to live until 90 or beyond (I believe there is a statistic that suggests 80% of every female child born in a developed country in the year 2000 will make it to 100 years old), which government is going to sort out healthcare issues that arise - and how does a worker in that environment make sufficient money to put aside as a pension?

It really is a can of worms for Asia, particularly if you care to look at the other end of the demographic lifeline.

One the one hand, you can take some comfort from the young populations that exist in Asia. In India, one out of every three people is below the age of 15. Indonesia, Korea, Thailand and Vietnam also have relatively young populations. In other words they have a "youth bulge" - to use one of the ADB's more technical terms. A bulge that has the potential to stimulate economic growth in the short term and asset creation in the longer term. But the stimulation comes from jobs, and they may no longer be so readily available.

And let's add one more ingredient to this rather depressing scenario. Asia has too many men. They cannot find wives, and if they can neither do that nor find jobs, they might just find extreme nationalism instead.

Lessons? Let us get on with doing something serious, really serious, about climate change but let's also deal with another growing problem that has the potential to create further instability.

Meanwhile, on a lighter note, I'm going back to read some of the revised song titles I have just been sent that will resonate with those who remember the originals; songs that are now entitled "The First Time Ever I Forgot Your Face", "I Can't See Clearly Now" and "A Whiter Shade Of Hair"

Quality - Losing The Plot.

2009-10-26T14:38:18+08:00

There was a time when "quality" could be used as a differentiator between products, people and places. A time when a person's word alone was sufficient to seal a deal. A time when the same item produced in two different places could be compared and a quality established as to which was superior. A period when "quality of life" was tangible not only in the balances one achieved between work and play, but measured by the conditions under which one lived; social, educational, political and environmental.

Of course, quality means different things to different people so I would not attempt a universal definition. I merely set out above a number of factors that bring the word to life, for me. So what is in my mind? (Not a lot, some would say, but I digress!).

As time has passed we seem to have become more willing to compromise on quality in the interests of speed or, worryingly, just "keeping the peace". Allowing standards to drop, for example, in written language. How I used to hate having my business letters reviewed by a third party before they were despatched - but it taught me to avoid ambiguity in my writing. Today we seem perfectly happy to receive letters that are not only written poorly in terms of grammar, but in a shorthand that leads to weird interpretation. I recall a number of years ago when a "circulation file" of already despatched letters came across my desk in another country, all signed by a Western executive. The letters were, frankly, awful and I went through them with a red pen, raising the hackles of the executive concerned who excused his work by saying that the typists were incompetent, would never change, and it wasn't that important anyway. My view was this was a "face" of the Bank, and it mattered to me. Point is - you do not have to give in to sub-standard work in the interests of either expediency or laziness.

Quality of air, at least in Hong Kong, is another issue where not being willing to address a problem head-on is creating present and future difficulties for the City. Whereas we are told by Government that overall air quality has improved in the last few years, try telling that to the pedestrians on Hong Kong Kong Island last week where roadside stations were registering pollution readings in excess of 160 - against an index that suggests at a pollution level of 100, people with heart and respiratory problems need to be extra careful. Air quality in Hong Kong over the last 30 years, probably like other cities, has declined. But I would argue that Hong Kong has worsened faster than most. Initially blamed on factories polluting the air across the border in Shenzhen (largely owned by Hong Kong businesses!), many of which have now moved or closed. Today is a holiday in Hong Kong, as a result of which I can see Kowloon albeit hazily from my window. Not something I was able to do last week from my office - which is nearer to Kowloon. This is because there is not so much traffic on the road today, or cars sitting with idling engines (not allowed, but which happens so that car owners can get into air-conditioned comfort). But it is estimated that more than half of Hong Kong's pollution is locally created - yet we have a Government that seems powerless to institute the changes necessary. This is not a new debate. In a speech I made in November 2006 I pointed to warnings that had been carried out 20 years earlier about the potential worsening of air quality in Hong Kong.

Quality of leadership is a subject on the lips of many today. Not necessarily from those who believe they could lead better, but those who are anxious to be well led. It doesn't matter where you look really - and I guess there are some potential bright spots but Britain wouldn't appear to be one of them. The BBC last week allowed the leader of the British National Party, a man described by a former Archbishop of Canterbury as a "squalid racist", to appear on television. The BNP's earlier manifestos called for the immediate deportation of 2 million non-whites from Britain, and the outlawing of mixed race marriages. They have now been forced by law to agree to allow anyone to join the BNP who wants to, and it will be interesting to see how this works in practice. The airing of the show was seen by some as a victory for openness and freedom of speech, but the implications worried me. An opinion poll carried out the following day indicated that 22% of people polled would consider voting for the BNP in an election. This was dramatically up from a rating of around 0.7% some months earlier. But they are not the only extreme right wing group in the world. Protectionism is more likely to raise its head in the face of job losses. Fast growing and young populations in some poorer economies will seek a better life - anywhere they can. As a result of which such nationalistic groups are likely to rise in number and popularity. It is not a prospect I relish.

So where does all this take us ... because the list can go on?

If we forsake "quality" because of some forceful bullies who operate in the financial, business, political and social world, and therefore abandon many of our standards, we will continue to decline. This will ultimately bring us down to the level of the lowest common denominator, inhaling air we can chew rather than breathe, and leaving no legacy worth having to our children's children.

Financial Centres

2009-10-18T12:33:21+08:00

In the financial markets recriminations still fly, regeneration is the buzzword, and "remembering the past" means the past 24 hours let alone 24 months. Governments fret over exit policies (or lack of them), investment bankers are looking forward to the next round of bonus payments and "joe public" scratches its collective head wondering what just happened; for him no job, too much debt, minimal prospects but the newspapers tell him it's all good.

Meanwhile, anywhere East of Istanbul, the cry has gone up "Let's be a Financial Centre!".

Putting aside for a minute the older established Asian centres of Tokyo, Hong Kong and Singapore, and the old debate about Shanghai's aspirations, and now that five year old successful "upstart" in the Middle East, the Dubai International Financial Centre (well, of course I'm biased!), I am beginning to wonder whether some of the new aspiring centres have any idea what they are talking about.

Designating a city (or cities in the case of Korea) as a financial centre seems to be the easy part. Do they mean an International Financial Centre or a Regional Financial Centre? Do they look at London and say, "they are an International Financial Centre so we want to be like them"? If so, there is a little matter of 300 years of history to contend with in terms of infrastructure (it's okay, we can build that), safety and security (oh yes, we will have that), and reputation (reputation? can't we buy that too?).

A Deloitte study of Istanbul's potential to be a financial centre was circulated at the IMF meeting I attended earlier this month. A study that suggested there were "twelve dimensions of competition" for financial centres in order for them to be successful. Reputation was just about mentioned, as an adjunct to Image. Of course, you can have all the legal environment and regulatory framework (two of the twelve dimensions) you like, but if it is not demonstrated - over time (which is how you build your reputation) - that it is applied evenly and fairly across the industry, then what's the point?

I am not picking on Istanbul particularly, but it just happens to be a city with aspirations for which I have a recent study. (I must also say it was my first visit - and it certainly won't be my last!). The Deloitte report, on which the Turkish Prime Minister and the Association of Banks is pinning a lot of hope, says amongst other things:

- Significant improvements must be made regarding the legal environment.

- The fiscal environment needs greater certainty and efficiency and requires reduction in some taxes.

- The regulatory environment requires a more coordinated and responsive regulator based in Istanbul.

- The availability of skilled labour needs improvement

- Currently there is no brand or image that supports Istanbul as a venue for international finance.

The above is only a selection of their commentary, but it highlights the difficulties facing a city like Istanbul, and to be fair, just about any other city that has similar aspirations.

It is actually quite easy to sit and enumerate the qualities needed to create a financial centre. Deloittes have done it for Istanbul. Even I do it reasonably frequently, when asked, and one never wishes to dampen the enthusiasm of city, provincial or national authorities who want to consider ways of improving their respective economies. What I find harder to do, and am therefore asked less frequently, is to provide solid arguments about the differences between International and Regional Financial Centres. Can Seoul, for example be an International Financial Centre and Busan be a Regional one? How would they be differentiated?

And I also find it hard to answer my own question about how many "Financial Centres" do we actually need? Given the growing aspirations of countries in the Middle East, who are now beginning to publicly state their own aspirations, as well as Mumbai, various other cities in China and the rest of Asia it is becoming a little like "Well you've got one, I want one too!". This usually ends up in a no-one really wins situation, but where any success will be created by the creative, the non-bureaucratic and the quick - using external help in the early stages to ensure that the basic rules are simply written, clearly understood and consistently applied. Where the long term view is to build a reputation. Where corruption is not a feature of the country and where foreign workers are welcomed to help in the process.

What's In A Name?

2009-10-13T14:10:59+08:00

Of course, it's all in the mind! And if, like me, you suffer from one that is slightly smutty, you tend to notice things that nice people wouldn't necessarily see at first glance. The object of my attention appeared in today's newspaper but before I get to it let me be serious for a minute.

There has been recent comment in Hong Kong, both in the press and on other blogs, about the inappropriate use of language in street names where words, once in common usage, have become derogatory in the more politically sensitive world of today. I am sympathetic to those who feel offended, and do not think we have to buy the argument from Government that making changes to street names would be too disruptive. But, again, there are always those who are prepared to be more extreme than is absolutely necessary in their demands for change. It is a fine balancing act to get it totally right, and you have to find pragmatic solutions that would satisfy the majority. History happened, and you can't change it (despite the attempts of some countries to have a go!). Obliterating names doesn't obliterate the past - and in fact is sometimes a salutary reminder of the things we, as human beings, got wrong.

This sort of issue falls into the same general category as apologising for the bad deeds of our forefathers who invaded, raped and pillaged anything they could get their hands on. There are many things I feel quite ashamed of in our history, and we do owe many apologies but how far back do we have to go before we are satisfied with those apologies. Should we choose a date in history and say "sorry, but anything that happened before 1745 we're not apologising for" ? Being sensible and grown up about history is the more appropriate course of action, to let us move on.

But I digress; back to names.

Jockey and Turf clubs around the world have a system of ensuring, as far as possible, that horse names remain pronouncable - and polite, for commentators and public alike. Some slip through the net, but are usually picked up pretty quickly. A case in point in Hong Kong was the horse that was allowed to run under its full name of Shinnecock Hills, rather than the preferred Shinnecock. But I now wonder whether the Hong Kong Government's Transport Department needs a similar monitor.

Vehicle registration marks in Hong Kong are in English, and the new scheme that lets you create your own has delivered some, shall we say, strange plates. (The car of similar make and colour to my own which bears the registration mark ELDON is, by the way, nothing to do with me. I am not a fan of the idea anyway). But the one that caught my eye today in the SCMP is the advertisement for the next round of auctions on 31 October, and specifically plate auction number 27 in the morning session. It is a perfectly respectable name in Chinese, but I am not so sure that English-speaking non-Chinese visitors to Hong Kong who don't know these things will be quite so understanding or approving. I also am concerned that it will become a source of irreverent and inappropriate comment in certain less savoury publications.

Imagine, for example, a quiet day out on the road with your granddaughter who is just learning to put letters together to form words. She sees the car of the successful bidder for Lot 27 and suddenly says "Look at that Fuk Hing car in front". Her Grandmother, for one, would have a fit!

Tall Poppy Syndrome

2009-10-03T15:22:05+08:00

If you have started to read this in the hope that it is something to do with creating genetically modified flowers that provide a greater volume of a well known narcotic - STOP!!

I am instead referring to a term used, particularly in Australia it seems, which basically means bringing someone down to earth. Now, put up your hand if you were genuinely shocked by the elimination of Chicago in the first round of voting to select the host venue for the 2016 Olympics. Okay, my hand is down - but I must say I was a little surprised at that particular turn of events even though I didn't think Chicago would win. (And to those people who still think it, I am not anti American!).

But think about it. The world's press headlines in the run up to the vote all trumpeted the fact that President Obama and the First Lady were going to Denmark to "bring the Olympics back to Chicago". Don't blame me for the headlines, I don't write them! They went on to say - ".. if the Games are not awarded to America this could prove financially damaging to the Olympic movement". The USA is the largest financial contributor to the Games. Didn't anyone think that this sort of news reporting might get right up people's noses? (get up someone's nose: Informal - to annoy someone).

You can argue that other heads of state, Kings, Presidents were also present in Copenhagen, and they made impassioned speeches on behalf of their country, so what was the difference between them being there and the US President? Simply the manner of his arrival and the newspaper headlines that accompanied it. The message received by others - and I have been asking a lot of people in different countries - (I have been in four in the last 7 days; five if you count Hong Kong), is that the news accompanying the President indicated he was going to walk in and take the prize. I don't blame the President. His heart was clearly where it should have been, but the timing was awful.

The Tall Poppy cutters obviously thought so too!

I feel for the cities that lost the vote. So much work and effort goes into the preparation of any bid but most people seem to think that it is the turn of Latin America anyway. The chosen city of Rio de Janeiro is a beautiful place, although it has a patchy history, a questionable security record and some difficult challenges ahead. They have something to prove in being awarded this prestigious event, and I am sure they will rise to it.

To my Brasilian friends Felicitações e boa sorte. See you there!!

P R and C ... and Sixty

2009-09-30T11:55:24+08:00

P, R and C - three seemingly random letters from the alphabet but which, put together as I write this week, have some interesting meanings.

In the first instance, PRC is of course the key set of initials leading people in many parts of the world to focus on the celebrations in China, as the People's Republic celebrates its 60th Anniversary. A number of friends are already in Beijing waiting for 1 October, to be present and to experience the atmosphere - although I suspect the visuals may actually be better experienced on the television. Wonder if the celebrations will be shown in Dubai, where I am headed?

Of course, feelings about the whole event - the cost, the scale, the symbolism and the multiple messages it sends - are already subject to much scrutiny and interpretation. I have not met anyone yet who is ambivalent about it, from university professors to taxi drivers and hairdressers (okay, barber in my case!), from Americans to Chinese, Australians and Africans - everyone it seems. From the overly optimistic to the prejudicially pessimistic. And the media for once is very mixed; some actually with glowing positive reports as to what all this means for the future - "balanced" by the downright scary.

China has spent lavishly on a couple of events in the last few years, what with the Olympics and now this parade. And we will never know the exact amounts. But when was the last occasion they spent like this? Maybe 20 years ago when they celebrated their 40th? Let’s remember that China operates its calendar under a sexagenary cycle, meaning that 60 is a particularly important milestone as calendars go. Yes some (or all) of that money could have been used for other purposes and yes, China is not perfect in so many ways. But I would argue it has improved dramatically certainly in the last 30 and is continuing to do so. It is probably one of the only economies in the world today that has some growth – having avoided some of the excesses suffered by its so called “developed” teachers and advisers. Why not have a party, and lighten up a little?

It is always interesting to me that people are quick to be critical of China, who take some pride in their nationalism. Is it possible that the Americans are any less nationalistic, or the Thais or the Singaporeans? As I wrote earlier, China Is not perfect. Its government does things that interfere with civil liberties but you cannot tell me that such issues are not present in the countries mentioned above. Oh, and they all have another thing in common - the death penalty. What a civilized world in which we live!

China is celebrating 60 years in a way they know best. It's a country that has 1.3bn people - of course there's going to be a cast of thousands. At least people can take a little ownership and say that they were a part of it.

Whether it suits us or not, we have to get used to the idea that China is a part of the world in which we live, and will be around for many more lifetimes. Perhaps the time will come when the world is going to need China's help somehow, and they'll have every right to turn around and say - why should we? But they won't, because that's not how they play their game.

Returning to the alphabet, where I started, not only is PRC in the news this week, but for me P and R are also in the news – and just happens to involve C too. Lost?

Public Relations are an important part of our world today. It doesn’t matter if you are a Fortune 500 company, or an individual – PR is all around you.

The announcements made by HSBC at the end of last week concerning the relocation of the Group Chief Executive to Hong Kong were a real PR coup in my opinion. Coming just one week before the 60^th Anniversary, the timing was perfect. The return home, in many ways, provides a ringing endorsement that Asia in general and China in particular is seriously important as far as the economic future of the world is concerned.

I have received many requests from journalists seeking my opinion on the move and on a number of the ramifications surrounding the decisions but I think I had better keep them to myself, other than to say, “Welcome home”!

And before I leave PR. I hope you noticed the announcement last week that the China Investment Corporation (CIC) has invested a substantial sum of money into Noble. That, coming on the back of a rating agency upgrade, saw a lot of positive PR for a company with which I am happy to be associated.

Finally, I had to smile at a smart (paraphrased) response from the eloquently elegant Madam Fu Ying, Chinese Ambassador to the United Kingdom that I saw on a news channel yesterday who, when asked by a British reporter whether the next 60 years might see a change in China, leading to giving people the vote said, “You mean, copy the way you do things?” Touché Madam.

All in all, a pretty good week for P, R and C – and happy birthday to a Sixty Year Old from an Over Sixty!

"What Did You Learn In School Today?"

2009-09-16T01:08:11+08:00

Maybe you don't know, or more likely have never heard of, the song by Pete Seeger with the above title. Actually, of course many of you have probably never heard of Seeger either but that's merely a function of age. An incredible folk singer, activist and great human being who at 90 is still going strong.

The song title jumped into my head today as I contemplated a question I was asked at a Forum in Singapore last week by an old and much respected friend, Tommy Koh, and a follow up question that was put to me in Beijing which had a bearing on what I said last week.

Tommy asked me if I could consider three lessons that I had learnt from the financial shenanigans of the last couple of years. A tall order I thought, to cover briefly - and only three of them at that - when there were so many thoughts running through my head.

In the end I did what I know other people do in a similar situation. I panicked. But I did think of three things. Three lessons that I learnt in "school" - perhaps not a formal school, and perhaps not today, but over a long period of time and that have come into focus recently.

"Basics", when linked to financial services, may be boring but there do not seem to be many financial institutions who stuck to the basics that went far wrong during the recent crisis. Let's face it, banking is not all that difficult. You are entrusted with other peoples money because they believe you are going to keep it safe. You have custody of that money and lend it to others who can use it to improve their businesses and/or their lives - and who will pay it back to you of course, so that when the depositors turn up asking for their money back you can return it. You can provide other services, but you should not go too far off the beaten track - especially with other peoples money. Lesson number one, if I have learnt anything at all in 40 years of banking - basics will rarely let you down.

"Greed": It doesn't seem to matter what angle you look at it from, the recent crisis was fueled in a large part from a desire by many participants to take a short cut to wealth. Deals were created that were inherently unsafe. Credit standards were allowed to drop, because there was a chance to make more money than ever before - in a short space of time. Many participants in the market knew there were problems brewing, but they wanted to get their bonuses and move on before everything hit the fan.

And as I have written before, bonuses are a part of life in the industry, but I think much more care would have been taken over the creation of some of these instruments of financial destruction if bonuses had been staggered, instead of being paid out quickly in lump sums. (And yes, this is a generalisation because some people were not paid out immediately, but I am talking about an industry on the whole). Lesson number two, reward well when deserved, reward fairly because it is the right thing to do, but don't hand it all out at once.

"Education": It seems to me that too many people were involved in financial dealings who had too little knowledge about what they were dealing in. You are rarely too young and never too old to learn new things. Boards of directors, for example, who approved products without asking some of the relevant questions because they felt they should already know the answers, and to ask would be a "loss of face". People who were selling products were insufficiently educated about what they were selling. Not their fault in many cases - it was management pushing sales targets, and telling their sales staff that "mini-bonds" were good. Regulators perhaps not moving quickly enough because they did not fully understand what was going on. Lesson number three; education at any time will never go wrong, and just because you happen to be a senior person and ask a question does not mean that you are losing the plot.

Those, then were the three answers I gave at the Forum last week, and then today it was suggested that every financial crisis is different, and that you cannot necessarily find answers from lessons of past crises. And while I agree that there are always some differences they are usually subtle as very often the basic problems are the same, and I return once more to the lessons from my recent favourite book, The Country Banker, where the author talks of the importance of learning "to distinguish those transactions in banking which are safe and legitimate from those which are unsafe". He cautions about the potential negative influences of the media, he warns of banks seeking to enhance profits imprudently at times when interest rates are low over a long period of time.

All characteristics of this crisis, all comments from a book written in 1885.

So what did you learn in school today, this month, this year, through your career? Whatever it was, it should provide a lesson for the next time, and be passed on - although it won't; no matter what new regulations we put in place, someone, somewhere is going to say "but it's different this time!".

Korea - Hopes, Dreams ... and Reality

2009-09-13T09:08:11+08:00

I like Korea. If I didn't, there is no way I would get involved as I have; what would be the point? Certainly Korea has its critics, both from inside and outside the country, but then what country doesn't. And just like every other country, emirate, state or region in which I have lived and worked in the last 40 years or so, Korea has its hopes and its dreams. The skill required towards achieving those dreams, though, is to indulge in an ongoing reality check to see whether and by how you much closer you are getting.

In September last year, South Korea was upgraded to "Developed Market" status by the FTSE Group - one year later than had been anticipated, but it happened. It is a status that many widely believe to have a significant impact on asset allocations by Fund Managers and a move that was, naturally, welcomed in Korea. Dream achieved.

During the last eighteen months it has been my privilege to sit as a Special Adviser on the Presidential Council for National Competitiveness. A Council that meets monthly and has undertaken to review many of the country's rules, regulations and laws with the aim of creating, inter alia, a more friendly business environment both for domestic and foreign participants. The meetings are chaired by a senior member of the Blue House, but are always attended by the President who remains throughout the length of every meeting. Much progress has been made over the period so far, but it takes time for this information to reach the world outside and in some cases legislation has been difficult to push through when dealing with a traditional culture where change is often viewed with some suspicion.

One of the more prominent dreams, for Seoul in particular a number of other cities and regions in general and the country as a whole, is the creation of a financial hub in Korea. After all, look around the region - Tokyo, Shanghai, Hong Kong, Singapore and a number of other aspiring centres and you can see the attraction of wanting to join in. Developed markets are generally service centres, rather than centres of heavy engineering and manufacture. But if you ask around the region and then further afield for their diagnosis of Korea's ability to become a financial hub, the view is that it is a long way down the list. That is a reality.

And while we are at it, let's just think of another financial hub reality - the reality of the huge Japanese economy on the one side (slow moving though it may be), and the ever growing and powerful economy of China on the other - and guess who is in the middle?

Korea certainly needs to do something, but why does it give negative perceptions to the global financial community? Because the financial scene in Korea remains less inviting to the very people who should be encouraged to enter the market. Existing rules and regulations remain ambiguous and complex despite ongoing attempts to make them clearer. But more needs to be done to unravel these regulations and to open up the financial services market wider to more participants.

Such concerns raise the noise levels around "obstructive ambiguity" and lead to charges of protectionism - of course not just in the case of Korea but around the world. And let's be clear, there are plenty of Governments whose actions suggest they say one thing and do another; think "Buy (Country)", think of the European Government that provided money for auto makers on condition they stayed in that country, and some months later very publicly spoke out on the subject of never returning to protectionism.

I can say this; I have heard President Lee say himself publicly, and maybe more importantly privately, that he has no time for protectionism. I certainly hope that his administration pays close heed to his words - especially as Korea is about to lead the G20 in 2010. The last thing Korea will need is to be confronted with any examples of protectionism as they move into this leadership role. That could put a halt to the hopes of a greater involvement from the outside world.

I was invited to advise, and I do so freely. Happily I am in a position where I can suggest certain courses of action - even if they may not be universally popular, but I do so with the best of intentions because I would like to see Korea succeed. Better that we have a collection of strong players in Asia than just one or two.

But never underestimate the Korean single-mindedness of purpose. They have proved time and again in their young democracy (which many forget is only 22 years old), that they can get things done once they put their minds to it. The world is a big place, and they need to be a two-way part of it if the dreams and hopes they nurture are to become reality.